In recent years, SEGA has rebalanced its development strategy to be more Western focused," said Naoya Tsurumi, CEO, SEGA of America, Inc. and SEGA Europe Ltd. "On the heels of our first, successful studio acquisition with The Creative Assembly, the addition of this development powerhouse further moves SEGA toward its goal of becoming a leading next-generation publisher."

After aggressively building a successful external development portfolio over the past 18 months, SEGA turned efforts inward to strengthen its global in-house development capabilities, looking keenly at strong next-generation developers to help it remain competitive.

According to Simon Jeffery, President & COO, SEGA of America, Inc., "We looked long and hard at building an internal studio from scratch, but were so impressed with the team at Secret Level and their next-gen technology that we decided to create our internal development infrastructure through a direct acquisition, one that could fulfill our dynamic growth plans and produce high quality games."

A SEGA development partner for almost a year, Secret Level, Inc. will take advantage of SEGA's vast library of content to stretch its legs for the next-generation systems. According to Jeremy Gordon, President of Secret Level, Inc., "SEGA's incredible library of IP and global publishing muscle will enable us to realize our full technical and creative potential. It's become clear that a combined SEGA and Secret Level are greater than the sum of our parts."

The Secret Level, Inc. development studio will continue to operate out of its current office in San Francisco.